Cheat Sheets

On the Series 7 exam, you may be asked to calculate the numbers in a short margin account. You have to start by setting up the formula correctly. The basic short margin account formula is as follows:[more…]

The Series 7 will expect you to know the skinny on SMA’s. A special memorandum account (SMA) is a line of credit that a customer can borrow from his margin account or use to purchase more securities on[more…]

Often, securities don’t go in the direction customers hope for and you have to deal with restricted accounts. The Series 7 will expect you to be prepared for both scenarios. When this happens in a margin[more…]

If an investor is employing the dollar-cost-averagingformula, she is investing the same dollar amount into the same investment periodically. The Series 7 will expect you to be familiar with this formula[more…]

You need to know two basic formulas to determine the sales charge and public offering price of open-end funds. The Series 7 will expect you to be prepared to use multiple formulas, but fortunately, you[more…]

Annuities are similar to mutual funds, except annuities are designed to provide supplemental retirement income for investors. The Series 7 exam tests you on the two basic types of annuities: fixed and[more…]

For the Series 7, you need to know about certain paperwork that’s specific to limited partnerships. Direct participation programs (DPPs) can raise money to invest in real estate, oil and gas, equipment[more…]

Certainly partnerships can be formed to run any sort of business that you can imagine, but the Series 7 exam focuses on the big three: real estate, equipment leasing, and oil and gas. You need to be able[more…]

The most basic options calculations for the Series 7 involve buying or selling call or put options. Although using the options chart may not be totally necessary for the more basic calculations, working[more…]

Fortunately, when you’re calculating the buying or selling of put options for the Series 7(which give the holder the right to sell), you use the options chart in the same way but with a slight change.[more…]

On the Series 7, not only do you need to know the difference between opening and closing transactions, but you also have to be able to calculate the profit or loss for an investor trading options. This[more…]

Be prepared to answer questions for the Series 7 dealing with Long Straddles and Combinations. Straddles are option positions in which the investor buys a call and a put or sells a call and a put on the[more…]

The Series 7 will expect you to understand short positions. Short positions involve selling a call and a put with the same underlying stock. In straddles, the calls and puts have the same strike price[more…]

The Series 7 will have questions that ask you to calculate the break-even point for spreads. The thought process is different for puts and calls, but either way, you begin by finding the difference between[more…]

Investors create a spread position by buying an option and selling an option on the same underlying security. The Series 7 will test your knowledge of these spread positions. The maximum gain or loss with[more…]

Option contracts offer investors security and the Series 7 will expect you to be able to determine the maximum gain and loss for these. When an investor purchases or sells option contracts on securities[more…]

The Series 7 will doubtless expect you to know how an option contract is adjusted for corporate actions such as a company declaring a dividend or splitting its stock. Begin with the basics and move forward[more…]

Investments aren’t exactly one-size-fits-all, so asking a client about his investment objectives can be a real help for the Series 7 and the real world. As a financial expert, you’ll likely have to help[more…]

Changes in money supply can affect rates of economic growth, inflation, and foreign exchange. Knowing about monetary policy can help you for the Series 7 and predict how certain securities will fare and[more…]

Here’s where the rubber meets the road. The Series 7 will expect you to know all about limit and stop orders. You can receive several types of orders from customers along with numerous order qualifiers[more…]

The ticker tape is a must know for the Series 7. It is also known as the consolidated tape. For subscribers, the tape delivers real-time (within 90 seconds) reports of securities transactions as they occur[more…]

Capital gains are profits made when selling a security, and capital losses are losses incurred when selling a security. The Series 7 will test your knowledge of these profits and losses. To determine whether[more…]

The Series 7 exam will ask you questions about calculating accretion and amortization. You use accretion and amortization when figuring out taxes on bonds; you simply adjust the cost of the bond toward[more…]